On March 14, 2025, Mark Carney was sworn in as Canada’s 24th Prime Minister, leading the Liberal Party to a fourth consecutive term. Just weeks into his tenure, Carney unveiled “A Mandate to Innovate,” a sweeping national tech strategy aimed at revitalizing Canada’s economic competitiveness and global technological standing. As a centrist liberal with deep roots in global finance and climate policy, Carney’s orientation favors market-driven innovation, ethical governance, and inclusive growth, hallmarks reflected in his administration’s early moves.

A Mandate to Innovate: Anchoring Canada’s Tech Future

Developed in collaboration with the Council of Canadian Innovators (CCI), Carney’s blueprint outlines five strategic pillars to accelerate growth in high-tech sectors, boost productivity, and secure Canada’s place in the global innovation race. The plan targets high-growth sectors such as:

Globally, these sectors are projected to grow at double-digit rates through 2030, with AI alone expected to contribute $15.7 trillion to the global economy. Domestically, Canada’s tech ecosystem is thriving, with Toronto and Vancouver leading the way in capital inflows, and startups raising $2.5 billion in the first half of 2025.

Canada’s Innovation Policy Highlights (2025–2030)

1. Independent Innovation Agency

A new agency, staffed by industry experts rather than bureaucrats, will offer real-time support to startups and scale-ups. It aims to help Canadian firms build, scale, and retain ownership of intellectual property. Initial funding is projected at $1.2 billion over five years, with flexible grants and equity-based support mechanisms.

2. Talent Retention and Global Recruitment

To counter Canada’s $1.4B talent crisis, where 72% of STEM graduates leave for opportunities abroad, the government is launching a national campaign to retain and attract top talent. Proposed policies include:

New visa pathways and competitive compensation packages will also target global innovators.

3. AI and Digital Infrastructure Investment

AI is central to Carney’s vision. The government will invest $3.5 billion in AI research, commercialization, and ethical oversight. An additional $2 billion will expand cloud infrastructure and broadband access in underserved regions, ensuring equitable digital participation.

4. Climate-Tech and Green Innovation

Leveraging Carney’s climate finance expertise, the administration will allocate $1.8 billion toward clean tech development. This includes:

5. Regulatory Reform and IP Protection

To reduce friction for innovators, outdated regulations such as those governing data residency, patent filing, and startup taxation are under review. Proposed reforms include:

Strategic Implications for Canada’s Tech Competitiveness

If executed effectively, Carney’s innovation agenda could boost Canada’s GDP by up to 2.5% annually over the next five years. But global competition is fierce:

Canada’s strength lies in its ethical governance, multicultural workforce, and climate-tech leadership, assets that can be harnessed to differentiate from tech giants.

Risks and Criticisms

While A Mandate to Innovate has been praised for its ambition, economists and policy experts caution that implementation challenges could temper its success.

Fiscal Sustainability:
The combined cost of the new programs, exceeding $10 billion in early estimates, could strain Canada’s fiscal framework, especially if economic growth lags or debt servicing costs rise. Critics argue that Carney’s fiscal optimism may rely too heavily on private-sector follow-through that is not guaranteed.

Dependency on Foreign Venture Capital:
Despite strong domestic startup activity, nearly 60% of late-stage venture capital in Canada originates from U.S. or European funds. This dependency could limit domestic ownership of key technologies, leading to “innovation leakage” as successful firms are acquired or relocated abroad.

Regional Inequality:
Innovation activity is heavily concentrated in Ontario, British Columbia, and Quebec. Without clear mechanisms for equitable investment, smaller provinces risk being left behind, deepening Canada’s regional economic divides.

Execution and Bureaucratic Inertia:
Even with an “independent” innovation agency, Canada’s history of slow program delivery and regulatory bottlenecks raises questions about administrative efficiency.

Geopolitical Exposure:
As global tech competition intensifies, aligning closely with Western tech standards could expose Canadian firms to retaliatory trade measures from China and other markets, potentially undermining export diversification.

Together, these risks underscore the importance of disciplined execution, fiscal prudence, and inclusive policymaking to ensure that the innovation agenda achieves sustainable impact.

Key Insights: Canada’s Innovation Strategy 2025

The Path Forward: Building a Resilient Innovation Economy

Prime Minister Mark Carney’s tech-forward policies mark a pivotal shift in Canada’s economic strategy. By prioritizing innovation, talent, and infrastructure, his administration is laying the groundwork for a resilient, inclusive, and globally competitive Canada. If “A Mandate to Innovate” delivers on its promises, it could redefine Canada’s role in the global tech ecosystem and inspire similar models across North America.